🥩Staking

The token will be at the heart of the Pear Protocol ecosystem, playing a valuable role in decentralizing the project and rewarding all participants in the ecosystem.

The token is where most of the protocol value will be accrued, in the form of ETH revenues. This level is currently set at 80% of all net fees* accruing to $PEAR stakers. The below graphic outlines how this works.

*net of referral and other discounts. ** note that fees ultimately flow in ETH - the use of USDC here is to simplify the illustration

The $PEAR token is one of two tokens in our ecosystem. When users come to our front end and stake it, they will receive $sPEAR (staked pear) in return (1:1 mint and redeem). By holding $sPEAR you qualify to receive a certain % of the revenue in the StakingPool. For example, lets say you own 1% of $PEAR supply (10,000,000 tokens), and you mint 10,000,000 $sPEAR (1% of supply). If the revenue pool was $100, you would be able to claim a maximum of $1.

In order to avoid the StakingPool being gamed, there will be a linear exit fee applied, slashing your $sPEAR:$PEAR redeem ratio based on how long you have been in the pool.

1 day: -20% exit fee

7 days: -5% exit fee

30 days: -1% exit fee

31 days: 0% exit fee

For the above user with 10,000,000 s$PEAR, if they exited after 1 day, they would incur the -20% exit penalty, redeeming 8,000,000 s$PEAR to 8,000,000 $PEAR (1:1) The 2,000,000 $sPEAR they paid as an exit fee would automatically be distributed on a pro-rata basis between all the sPEAR holders, rewarding those who are more loyal as they can receive a higher % of the pool.

Thus, a user may wish to think about these 3 elements: 1) APR from staking 2) Gaining more sPEAR which can later be converted to PEAR (1:1) as people exit staking 3) Price appreciation of $PEAR as revenues and the protocol grows.

Note: As of 26 September 2024, 80% of the revenues from the Isolated and Cross-engine (Orderbooks) are automatically sent to the staking contract. Fees generated on our Intent based engine are currently being added manually whilst we automate the process and move out of beta.